Offshore Areas Mineral (Development And Regulation) Amendment Act, 2023

Policy Update

Shivali Yadav

 Background

For over ten years, India maintained a law aimed at allowing mineral development of its seabed, yet for the same period, very little occurred. The Offshore Areas Mineral (Development and Regulation) Act was enacted in 2002 and took effect in 2010, providing the government with a legal structure for mining in territorial waters, the continental shelf, and the Exclusive Economic Zone. However, when the Ministry of Mines was questioned about this in Parliament, their response was straightforward: no mining operation had ever started under the previous system. The Ministry was direct about the reason as well. It stated clearly that the distribution process allowed excessive discretion and failed to provide a fair, transparent method for assigning operating rights.

This wasn’t precisely a novel issue for Indian mining policy. In January 2015, the government had previously undertaken this task regarding land, modifying the Mines and Minerals (Development and Regulation) Act of 1957 to substitute discretionary allocation with competitive bidding. Offshore mining ultimately received similar treatment. In July 2023, the government presented the Offshore Areas Mineral (Development and Regulation) Amendment Bill in the Lok Sabha, and progress was swift: approved by the Lok Sabha on August 1, by the Rajya Sabha two days afterward, and enacted on August 17, 2023. The concept was simple: replace a system based on discretion with one founded on competition.

 Functioning

The amendment didn’t merely adjust the existing law; it restructured the distribution of offshore mineral rights. Currently, there are two kinds of operating rights: a composite licence that includes both exploration and production in two stages, and an independent production lease. If you are a private company, you can obtain one exclusively via a competitive e-auction; there’s no alternative way in. Conversely, blocks allocated for the government remain with the government or state-owned enterprises, although there is potential for joint ventures provided that the government entity maintains a minimum of 74 percent ownership. Atomic minerals receive even more stringent treatment; exploration, production, and composite licenses are restricted solely to government entities.

The size and length of these concessions have also been altered as well. Production leases are now set for a fixed term of 50 years, aligning them with onshore mining laws, and the previous renewal option has been eliminated. Block dimensions decreased significantly from 5 minutes by 5 minutes of latitude and longitude to merely 1 minute by 1 minute, while a limit was established to prevent any single company from managing over 45 minutes by 45 minutes of offshore space collectively. The reasoning is straightforward: dividing into smaller blocks and capping total holdings aims to prevent any single player from monopolizing the market.

Another aspect to note is the Offshore Areas Mineral Trust, a perpetual fund supported by an additional charge on concession holders of up to one-third of the royalty they remit. The funds are intended for research exploration, environmental assessment, disaster assistance, and aid for communities impacted by mining. Combine everything, and what you obtain is an authentic transition from the traditional discretionary model to one motivated by competition, featuring new protections integrated.

3. Performance

Key legislative and implementation milestones for the offshore reform, drawn from official notifications, PIB releases and Parliamentary proceedings, are set out below:

Source: Offshore Areas Mineral (Development and Regulation) Amendment Act, 2023; Press Information Bureau, Ministry of Mines releases (2023-2024); Lok Sabha proceedings, 1 April 2025.

In contrast, the Ministry’s concurrent onshore auction program for critical minerals, carried out under the related Mines and Minerals (Development and Regulation) Amendment Act, 2023, produced a consistent, publicly disclosed series of outcomes during the same timeframe. The Ministry reported 22 cumulative critical mineral blocks successfully auctioned after Tranche IV (June 2024) and 34 cumulative blocks, which included India’s inaugural auctioned potash block, after Tranche V (May 2025), with an initial Exploration Licence tranche of 7 blocks finalized by September 2025.

No corresponding public statement from the Ministry confirming the successful awarding of the Tranche I offshore blocks was found in the public releases of the Ministry of Mines, Parliamentary responses, and publicly accessible auction-related documents reviewed for this analysis, even considering the considerable time that has passed since the original bid deadline at the end of February 2025. Highlighting this information gap, a starred Lok Sabha question featuring two ruling-party Members specifically inquiring about the count of bids submitted, shortlisted bidders, and the socio-economic impact assessment for the 13 offshore blocks was retracted through a corrigendum to the Question List just before it was scheduled for oral response, a matter later brought up in Parliament by Opposition Members.

 Impact

When comparing the launch of offshore mining to the events that took place on land under the concurrent critical-minerals auction program, the difference is significant. The Ministry has consistently announced outcomes from the onshore sector: 22 blocks successfully auctioned post-Tranche IV in mid-2024, 34 after Tranche V by May 2025 (which includes India’s inaugural potash block), and the initial tranche of exploration licenses completed by September 2025. However, there hasn’t been a similar announcement made offshore. Over a year since the original bid deadline of February 2025, which was extended multiple times, there has yet to be any public confirmation from the Ministry that any of the 13 Tranche I blocks were awarded to anyone.

It becomes more peculiar. A starred question in the Lok Sabha, introduced by two MPs from the ruling party, directly inquired about the number of bids received, the shortlisted bidders, and information regarding the socio-economic impact assessment for these 13 blocks. The question was retracted through a corrigendum just before its scheduled response, and Opposition members observed this, bringing the matter up in Parliament. None of this demonstrates that anything was intentionally concealed, but it does introduce an additional layer of ambiguity to what ought to be a straightforward collection of facts regarding a public auction.

 Emerging Issues

In a limited sense, indeed, the 2023 amendment achieved precisely what it intended to accomplish in writing. It eliminated the discretionary system that the Ministry had criticized for fourteen years of inaction, substituting it with a competitive structure that reflects what has been fairly effective on land since 2015. It additionally introduced elements that the original 2002 legislation lacked: a specific fund for ecological research and community assistance, obligatory allocations for protected marine zones, and a stipulation for environmental approval prior to the commencement of any production.

However, enacting a superior law differs from achieving real mining. The potential for genuine development hinges on various factors unrelated to legislation, including the availability and cost of suitable technology, the commercial viability of mining minerals such as cobalt, nickel, copper, and manganese from polymetallic nodules, the ability of companies to navigate regulatory challenges in a timely manner, and the management of ecological and livelihood issues to prevent ongoing opposition. These minerals hold significant strategic value, essential for infrastructure, advanced manufacturing, and the larger transition to cleaner energy, yet having strategic importance on paper does not ensure they will be extracted from the seabed.

Based on all publicly accessible information at this moment, no one can definitively claim that Tranche I achieved a successful allocation. It’s evident that the process has extended far beyond its initial deadline, Parliament continuously inquires about it without receiving a comprehensive response, and a particular request for auction data was withdrawn at the last moment. That doesn’t demonstrate failure, but it also doesn’t indicate success, and that discrepancy in the record presents a problem.

Simultaneously, interpreting “no confirmed allocation” as “certainly no mining activity” would be an error. The public record does not indicate either side. What is evident, however, is that resistance from Kerala’s fishing communities remains; it has turned into a consistent aspect of this entire process, appearing in Question Hour, a Calling Attention Motion, and continual government declarations supporting the existing protections.

 Way Forward

The true evaluation of this reform isn’t its readability in legal terms; it’s whether it genuinely stimulates mining operations and if the government is prepared to be open about the outcomes regardless. Several factors could significantly contribute to addressing that.

Initially, the Ministry ought to release a comprehensive, tranche-by-tranche update on the outcomes of the 13 Tranche I blocks, detailing the number of bids received, the qualified bidders, and the status of each block, similar to the transparency it currently offers for onshore auctions. Additionally, conducting an independent socio-economic and environmental analysis for areas close to active fishing zones would significantly contribute to addressing the inquiries Parliament is continually posing, and would demonstrate if the current protections are truly sufficient rather than merely presumed to be.

Third, considering the specialization and capital intensity of deep-sea mining technology, implementing a phased technology transfer or joint venture incentive might assist in developing local expertise before the upcoming auction cycle. Fourth, utilizing the government/PSU approach as a proof-of-concept, allowing state-connected companies with marine knowledge to showcase that offshore extraction is effective before expanding additional private segments could be worth considering alongside the private auction method. Ultimately, considering the significant protests and parliamentary focus this has sparked, the government’s interaction with coastal communities must extend past sporadic roadshows or webinars.

Should the government establish a genuinely improved legal framework alongside true transparency and effective environmental practices, offshore mining could significantly aid India’s mineral security objectives and its wider Viksit Bharat 2047 aspirations, while also aligning with global obligations concerning ocean health and industrial growth. However, at this moment, the legislation has been modified. It remains uncertain if the outcome has also altered.

References

1. Lok Sabha. (2025, April 1). Question Hour proceedings on offshore mining in Kerala; replies by the Minister of State for Fisheries, Animal Husbandry and Dairying and the Minister of State for Environment, Forest and Climate Change. Parliament of India.
2. Lok Sabha Secretariat. (n.d.). Question list and corrigendum records on the auction of offshore mining blocks, Winter Session proceedings. Parliament of India.
3. Ministry of Law and Justice. (2023, August 10). The Offshore Areas Mineral (Development and Regulation) Amendment Act, 2023. Government of India. Official Gazette
4. Ministry of Mines. (2024). Offshore Areas Mineral (Auction) Rules, 2024; Offshore Areas Operating Right Rules, 2024; Offshore Areas Mineral Conservation and Development Rules, 2024. Government of India. Ministry of Mines—Offshore areas legislation and rules
5. Ministry of Mines. (n.d.). Tranche I auction notice inviting tender—Offshore areas mineral blocks. Government of India. MSTC e-auction platform
6. Press Information Bureau, Ministry of Mines. (2023, August 3). Parliament passes the Offshore Areas Mineral (Development and Regulation) Amendment Bill, 2023. Government of India. PIB release
7. Press Information Bureau, Ministry of Mines. (2024, November 27). Ministry of Mines to launch the first tranche of the auction of mineral blocks in the offshore areas of India. Government of India. PIB release
8. Press Information Bureau, Ministry of Mines. (2024, November 28). Ministry of Mines launches the first-ever tranche of auction of mineral blocks in the offshore areas. Government of India. PIB release
9. Prasar Bharati. (2024–2026). Reports on launch of offshore and critical/strategic mineral auction tranches, Ministry of Mines. News On AIR, Government of India. News On AIR

About the Contributor: 

Shivali Yadav is pursuing an M.A. in Liberal Studies at Govind Ballabh Pant Social Science Institute, Prayagraj, and is an IMPRI intern. Her work focuses on gender, education, youth, and public policy, with interests in educational equity and qualitative research. 

Acknowledgement

The author sincerely thanks the reviewers and editorial team for their valuable comments, constructive suggestions, and guidance. Their feedback helped improve the clarity, structure, and analytical depth of this policy update.

Reviewers:  Sandra menon, amruth kolluru

Disclaimer :

All views expressed in the article belong solely to the author and not necessarily to the organisation.

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